GLD up 50% and GDX up 128%. GDX Shorts up, GLD Short Down. Pain on the Short Side

Gold (GLD), the commodity, is up almost 50% year-to-date, while gold stocks (GDX) have surged over 125% — a reflection of their leveraged exposure to gold's price.

No other U.S. ETFs — outside of the mining sector — have gained over 50%, aside from a few AI-focused technology funds.

Gold’s rally is being driven by inflation concerns, anticipated interest rate cuts, and weakening global economic conditions. Political uncertainty — from U.S. government shutdown risks to escalating geopolitical tensions — has further fueled safe-haven demand. Additionally, ETF accumulation, short-term momentum, and bubble-like investor sentiment have contributed.

GDX, the gold miners’ ETF, has seen short interest rise alongside its rally — a textbook sign of reversal-driven short selling. The short interest position now stands at 15% — partly due to a decline in shares outstanding — though the absolute number of shorted shares has also increased, indicating sustained bearish positioning. This remains a relatively modest short interest % of float for an ETF that has more than doubled year-to-date.

At the same time, GDX’s shares outstanding have declined, signaling net selling by institutional long holders and profit-taking behavior following the rally.

In contrast, the GLD ETF shows a different pattern: its float is expanding while short interest is falling, suggesting renewed investor confidence and long accumulation. On the long side, GLD’s institutional long holdings data have remained relatively stable in both percentage and share terms.

This divergence underscores how equity-focused investors and commodity-based allocators are deploying different strategies — one emphasizing leverage and reversal, the other favoring steady accumulation and long exposure.

Short interest in individual gold stocks has also increased, mirroring the ETF’s trend — though the short position remains modest across most names. Volatility in both GLD and GDX has declined compared to earlier periods — pointing to sustained investor enthusiasm rather than short squeeze risk or speculative chaos.

Implied volatility has been rallying recently, indicating that the recent leg up has been marked either by call buying, on long investors wanting not to miss the upside, but hedging the downside.

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